Systemic T cell immunity is intact in both cancer patients and in murine models but Tumor Infiltrating Lymphocytes (TIL) are defective in cytolytic function. Available date describing TIL dysfunction suggests that tumor-induced suppression of TIL effector phase function is a common characteristic of cancer, which may contribute to tumor escape from antitumor immune response. We have determined that T Cell Receptor-mediated signaling is defective in both non-lytic CD8+ TIL in situ and when freshly-isolated: upon conjugation with cognate MCA38 adenocarcinoma cells in vitro TIL do not activate tyrosine kinases or flux calcium. The TIL signaling defect is proximal: contact with tumor causes rapid dephosphorylation of the activation motif (Y394) in p56lck therein preventing propagation of the activating signal. In non-lytic TIL, but not in lytic TIL, the inhibitory phosphatase Shp-1 is activated and colocalizes with the TCR complex at the TIL: target cell contact site. TIL signaling and lytic defects are completely restored upon purification and brief culture in vitro including dissociation of Shp-1 from the TCR complex and reduction of Shp-1 phosphatase activity. Recovery of defective TIL signaling in vitro is blocked by coculture with tumor cells. Also, if TIL are first "recovered" prior to coculture with tumor cells, the TIL proximal TCR signaling defect is re-introduced by contact with tumor. Upon culture of TIL with syngeneic non-cognate tumor cells (e.g. MC57G) or purified tumor-associated macrophages, TIL signaling and lytic functions are not affected. These observations show that tumor cells deliver an inhibitory signal to TIL resulting in recruitment of activated Shp-1 to the TCR complex, which induces defective proximal TCR signaling and therein blocks lytic function. Identification of the T cell binding partner, which recruits Shp-1 to the TIL TCR and also identification of the tumor-expressed ligand for the Shp-1 binding partner are goals of the proposed project. The proposed project will determine the mechanistic basis for tumor-induced inhibition of lytic granule exocytosis in CD8+ T cells, which infiltrate a murine model of primary cancer. Our long-term goal is to define the mechanism by which tumors escape elimination by the immune response, which will have implications for the rational design of effective immunotherapeutic tools for treatment of cancer, as well as contribute to our understanding of how antitumor T cell response is regulated during tumor growth.